Trade association

May 9, 2005

NCTO members vote to endorse DR-CAFTA

By Devin Steele

GASTONIA, NC  Responding to assurances to concerns about problematic areas in a free trade agreement between the United States and five Central American countries plus the Dominican Republic, members of the National Council of Textile Organizations (NCTO) on May 5 voted to support the pact.

Members converged on the associations offices here to try to hash out differences and determine whether or not to hold a vote to support or reject the Dominican Republic-Central American Free Trade Agreement (DR-CAFTA), according to a member.

The endorsement represents a departure between NCTO and two other textile or manufacturing-based trade groups, the National Textile Association (NTA) and the American Manufacturing Trade Action Coalition (AMTAC). Both of those associations have said they would not support DR-CAFTA in its current form, which includes loopholes for non-signatory countries to benefit from the pact.

The NCTO received assurances that several textile industry concerns would be addressed in DR-CAFTA, the council said in a statement. Among those concerns: a provision that allows for nonvisible pocketings and linings to be sourced from anywhere in the world; cumulation, which allows Mexico and Canada to benefit from the agreement; and trade preference levels (TPLs) with Nicaragua, which provide another outlet for non-qualifying countries to gain easier access to the U.S. market.

NCTO recognizes the strong and important ties between the domestic industry and the DR-CAFTA countries, NCTO said in a statement. The DR-CAFTA region is a very important part of the domestic industrys supply chain and we need this DR-CAFTA to ensure that the U.S. textile industry can remain competitive against China.

The U.S. textile industry exported more than $5 billion a year in yarns, fabric and component parts to the region last year, the statement continued. We are pleased with the administrations recent efforts to clarify its intent with respect to certain provisions of the DR-CAFTA that are problematic for the industry, especially regarding pocketings and linings, cumulation and TPLs.

Bush administration officials this month made separate promises to try to garner support for the agreement from the industry and lawmakers from textile-producing states.

In letters May 3 and 4, administration officials ensured the hiring of U.S. Customs officers and agreed to address textile and apparel rules of origin concerns.

New U.S. Trade Representative Rob Portman, in response to a recent inquiry from Sen. Elizabeth Dole (R-NC), committed that upon ratification of DR-CAFTA by the Congress, USTR will utilize the DR-CAFTA amendment mechanism to pursue a rule of origin change for nonvisible pocketings and linings.

This will ensure that $100 million in existing U.S. pocketing and lining exports to the region are not lost to China, the NCTO said. We look forward to working with Ambassador Portman to ensure this change occurs.

I assure you that USTR will utilize this mechanism, working closely with our textile industry, to seek an amendment to the CAFTA so that pocketing would have to originate in one of the signatory parties, Portman wrote in a letter to Dole.

The administration also reaffirmed its commitment to negotiate a substantive and aggressive Customs Enforcement Agreement with Mexico before cumulation is implemented, according to a letter from Peter Allgeier of USTR to Allen Gant Jr., NCTO chairman.

The DR-CAFTA dictates that a Customs Enforcement Agreement must be in effect between the U.S. and Mexico prior to the cumulation provisions of the agreement being utilized.

Additionally, Nicaragua recently committed to allocate its trade preference levels (TPLs) to its current non-qualifying U.S. trade, to help ensure that existing U.S. business is not affected by this provision.

This is a significant commitment on behalf of Nicaragua since the TPL could potentially displace nearly $100 million in existing U.S. business to that country, NCTO said.

We continue to work closely with the administration on these important issues and many others affecting our industry, NCTO added. We look forward to continuing this relationship to the benefit of all U.S. textile manufacturers and workers.

AMTAC, NTA stand firm

In response to NCTOs endorsement, the AMTAC and the NTA on May 9 reaffirmed its opposition to DR-CAFTA.

Like NAFTA, CAFTA is certain to be a job killer for the U.S. manufacturing, and the U.S. textile industry in particular, AMTAC Executive Director Auggie Tantillo said in a press release. AMTAC cannot nor will not support any trade agreement designed to outsource domestic manufacturing jobs. Trade deals like CAFTA are why the United States ran a $617 billion trade deficit in 2004 and has shed nearly 3 million high-paying manufacturing jobs in the last five years.

DR-CAFTA represents the replication of a flawed trade policy, he added.

While the U.S. government has promised to seek to fix the pocketing problem, an objection from a single CAFTA country can torpedo any amendment to the agreement, the group added. To date, not a single CAFTA country has pledged support for fixing the pocketing problem.

Related to Nicaragua, AMTAC said that while Nicaragua has made a commitment not to allocate its TPL in a manner that would displace existing production in Nicaragua using U.S. components, nothing will prevent them from using the TPL to take away business from other CAFTA countries that use U.S. components.

AMTAC acknowledged USTRs commitment to negotiate a stronger customs agreement, but pointed out lackluster efforts by the U.S. government to enforce laws against illegal textile transshipment in the past.

Meanwhile, the NTA, which represents 135 member companies  80 of which are directly engaged in the manufacturing of fabrics in the U.S.  responded with disappointment to NCTOs endorsement of DR-CAFTA.

This flawed agreement, if passed, will bring yet more job losses to the American textile industry, said NTA president Karl Spilhaus.

It is astounding that the yarn suppliers and other supplier members on the NCTO board could act with such extreme short-sightedness, Spilhaus said. Their support for CAFTA is directly contrary to the interests of their customers, the companies who weave, knit, or finish fabric in the U.S.

NTA said it has consistently opposed CAFTA since it was negotiated in late 2003.

During the negotiating of CAFTA the NTA Board voted a position that stated four items that they needed to have included in CAFTA in order to get NTA support:

1) no TPLs;

2) no cumulation with non-partner countries;

3) a rule of origin with no derogations (such as the single-transformation rule for brassieres) and with a workable provision for a special regime modeled on that in NAFTA; and

4) a short-supply list and short-supply procedure at least as favorable to American textile makers as those in existing arrangements.

The administration failed to deliver on any of the four points, NTA said.

We said when they concluded the agreement that we were opposed, Spilhaus said, and I dont see where they have offered anything that would get us to reconsider.

Trade association

May 9, 2005

NCTO completes whirlwind first year with successes

Editors note: In advance of the National Council of Textile Organizations second annual meeting, following is a Q&A with Allen Gant Jr., co-founder and chairman of the group and president and CEO of Glen Raven, Inc., Glen Raven, NC. His responses are to questions submitted to him by Devin Steele, STN editor. The council meets May 17-19 in Washington, DC.

Allen Gant Jr., chairman and co-founder of the National Council of Textile Organizations (NCTO), oversaw the birth and early maturation of the group. NCTO holds its second annual meeting May 17-19 at the Grand Hyatt, Washington, DC. Gant is president and CEO of Glen Raven, Inc. Photo by Devin Steele

STN: NCTO, formed with the merger of the American Textile Manufacturers Institute and the American Yarn Spinners Association, recently completed its first year of operation. From the outside looking in, the year seemed like nothing short of a whirlwind for the organization, given the number of actions taken and accompanying communiqués issued by the group. What was it like on the inside?

Gant: Whirlwind is putting it mildly. Managing both NCTOs effort domestically and internationally has been an enormous challenge. It took a tremendous effort among the staff and all our members to make our first year a success. There were many early mornings and late nights, but at the end of the day, it was all worth it because we know we are on the right side of the issues and that preserving American textile manufacturing is worth the energy and dedication.

STN: With staff in Washington and Gastonia, NC, how is the merger working internally and externally, generally speaking?

Gant: The merger of the staffs has gone quite well. There are obvious challenges to merging computer systems, management systems, communication systems, etc., but we made it through and are now completely integrated with one another. Luckily, todays technologies allow an organization to have staff in multiple places and still operate seamlessly and effectively.

STN: Obviously, unity is an important goal of the organization, particularly considering past differences involving industry sectors. During NCTOs first annual meeting last year, Allen, you told members, I dont want to say I almost cried, but I did this morning. It is truly a momentous occasion to see this industry come together and it does my heart a great deal of good. How has NCTO helped members find common ground and realize that one-voice, united-we-stand objective over the last year?

Gant: As an organization, it has always been our objective to focus on the big picture. There are many important issues that brought us together in the first place, and we have tried to stay focused on those issues and not get lost in the few issues over which we disagree.

The threat from China being the obvious one, but there are others. Establishing an ongoing dialogue with our sister organizations around the globe has also helped us understand that we are not in this alone. Indeed, it doesnt matter whether youre a Turkish, Italian, Peruvian, South African or Bangladeshi textile manufacturer, the challenges of competing in todays global economy are the same. It has been an eye-opening experience to join with our competitors around the world and engage in a productive dialogue and exchange of ideas.

Our work with other organizations has also helped. As you know, we have worked closely with AMTAC (American Manufacturing Trade Action Coalition), NTA (National Textile Association), the National Cotton Council and UNITE HERE!, among others, to pursue common interests. Again, the success of this effort has hinged upon the fact that we remain focused on the big issues and dont allow our differences to prevent us from harnessing our resources efficiently and effectively where we do have common ground.

I believe our unity has brought us further in the past year and has given us more visibility than any the industry has experienced in the last 15 years. I am hopeful that this tradition will continue.

STN: Your call last year for the World Trade Organization to hold an emergency meeting to discuss the potential effect of quota elimination on the worldwide textile industry didnt gain much traction and now, as they say, the toothpaste is out of the tube. With quotas now gone, your group and other industry allies have been busy dealing with the expected surge of Chinese imports. Beyond providing the status of the safeguard petitions, since that situation is so mutable, please explain how much of a difference your efforts are making in this important industry matter.

Allen Gant Jr. (C) talks with Jim Booterbaugh (R), director of operations for National Spinning Co., and Jorman Fields, president of TNC Global Consulting, prior to the start of a recent Southern Textile Association meeting in Greensboro, NC. Gant was the featured speaker.
Photo by Devin Steele

Gant: It is true that the WTO did not hold an emergency meeting  but that was only because China blocked it and, as you know, a single country can bring the whole organization to a standstill. What we accomplished in pushing for an emergency meeting was, however, remarkable and an effort that will pay dividends for years down the road.

Essentially, over a six month period of time, we created a new international coalition called the Global Alliance for Fair Trade in Textiles (www.fairtextiletrade.org) and organized almost 100 textile and apparel groups from more than 50 countries to take China on at the WTO. As a result, we were able to elevate China and the quota phase-out to the top of the WTOs agenda. More than 25 countries stood up at the WTO at the end of last year and said that China could not be allowed to take over the worlds textile and apparel trade.

This result has laid the international groundwork for safeguard actions to proceed against China now that quotas are gone. Argentina and Turkey have already moved ahead and imposed safeguards and now the United States and the European Union are poised to do so as well. The end result is that we are now organized in capitals across the globe and in Geneva at the WTO. We are going to insist that safeguard measures move ahead in major markets around the world and also that a permanent safeguard be included in the Doha Round of trade talks.

STN: How is the organization quantifying successes?

Gant: During the past 12 months, NCTO engaged in a number of legislative, government and international initiatives to support the domestic textile industry:

As mentioned, NCTO was a founding member of the Global Alliance for Fair Textile Trade, a coalition formed last year and now consisting of 96 trade groups from 52 countries that are opposing Chinas take-over of world textile and apparel trade.

As a founding member, NCTO co-organized three international conferences on China which were held in Brussels, Geneva and Washington, DC, and briefed dozens of governments both in Washington and Geneva on the threat from China and how it can be addressed. As a group, GAFTT was primarily responsible for the emergence of a new bloc of countries that are opposing Chinas efforts to monopolize world textile and apparel trade in the post-quota era.

STN: How about on the domestic front?

Gant: NCTO organized two Textile Unity events in Washington, DC, including the largest lobbying day to take place in Washington in more than 15 years. Over the past year, NCTO staff and leadership made more than 150 visits to members of Congress and briefed the Congressional Textile Caucus on five occasions.

NCTO also initiated a new Congressional communication campaign with key members of Congress now getting updates on industry issues every two weeks. As a result, communications between the textile industry and Capitol Hill are better now than they have been in over a decade.

NCTO outreach to the administration was the most extensive the industry has had in many years. These included multiple meetings between NCTO leadership, the U.S. Trade Representative and senior White House staff. NCTO successes on the domestic front included the defeat last session of a Haiti bill that would have harmed industry interests, successful application of the China textile safeguard by having quotas re-imposed in four textile and apparel categories that were removed from quota in 2002, the governments acceptance of industry safeguard threat petitions on China, increased funding for the U.S. Customs Service to focus on textile enforcement and the expansion of textile support on the Hill to include signatures from almost 175 congressman and senators on a letter regarding the impending threat from China.

NCTO also was a lead player in organizing joint industry efforts on behalf of the entire textile industry, including working with the National Cotton Council and the American Manufacturing Trade Action Coalition to develop joint industry positions on trade and other issues.

NCTO also worked diligently to broaden industry outreach to other manufacturing and labor groups and was a founding member of the Sound Dollar Coalition and the China Currency Coalition. NCTO serves on the Executive Committee of the China Currency Coalition and participated with other major trade groups in filing the first ever 301 petition on Chinas currency manipulation. NCTO is also a founding member of the CVD/NME Coalition to allow U.S. companies to take subsidy cases against China and other non-market economies.

Regarding the media, NCTO staff and leadership held or participated in almost two dozen press conferences and issued 52 press releases. NCTO staff and leadership were featured in textile news stories on CNN, Lou Dobbs, MSNBC, ABC, Bloomberg News, NPR and in hundreds of newspaper stories, including those in The New York Times, Financial Times, The Wall Street Journal and The Washington Post.

STN: What were some of the grassroots efforts and other internals initiated by NCTO?

Gant: NCTO also established a new PAC  TextilePAC  and developed a new grassroots network focused on generating support and input at the plant level of our member companies. This network was utilized to deliver thousands of letters and e-mails in support of successful industry efforts regarding the acceptance of threat petitions against China by the U.S. government.

Over the past year, NCTO also developed a website, a comprehensive bi-weekly newsletter  NCTO NEWS  and a textile news information service, Textiles in the News.

In terms of member outreach, NCTO exceeded its membership goals for the year with nearly 100 charter members from across the yarn, fabric, fiber and related industry support sectors.

STN: Representatives of your group have been all over the media in recent months, getting your issues out to the public. Do you think the worm is beginning to turn as it relates to: a) lawmakers beginning to take positions more favorable to domestic manufacturing, including textiles and apparel; and b) consumers connecting the dots between U.S. trade policy and the health not only of American manufacturing but of the countrys general economy?

Gant: We are very grateful that many of our members have taken on such a proactive role in reaching out to the media and making our positions known. Fortunately, the issues affecting textiles are also affecting many other areas of manufacturing, so we are not a lone voice in this effort.

With record U.S. trade deficits that now account for almost 6 percent of GDP, and the escalating demands for resources, which are driving up costs for important commodities such as gasoline, many lawmakers are starting to seriously evaluate the short- and long-term consequences for our economy and national security.

As such, I think we have seen a measurable shift in Congresss posture on many of these issues, especially as it relates to China.

We have witnessed several attempts in the Senate to pass legislation imposing punitive tariffs on China. We have seen numerous bills introduced in the House and Senate to address Chinas continued manipulation of its currency, to allow for countervailing duties to be imposed against China, and to hold China accountable for its ongoing intellectual property abuses.

I dont think this fervor will end anytime soon. In fact, I think more and more members will become increasingly focused on restoring health to our manufacturing sector. As such, I am hopeful we will see a concerted effort to develop a manufacturing policy for this nation that focuses on preserving jobs and providing manufacturers with the tools they need to compete in a global economy.

STN: The organization undertook a prodigious task last year in founding the Global Alliance for Fair Textile Trade (GAFTT). As a founding member, NCTO co-organized three international conferences on China in Brussels, Geneva and Washington, DC, as mentioned. What does the group have planned for the balance of this year?

Gant: Our most pressing goal this year involves the Doha Round of trade talks and making sure that a permanent safeguard against China is included in the round. As you know, the current China textile safeguard only lasts through the end of 2008 and unless something permanent takes its place, then the whole game is up.

Given the stakes involved around the world, we think a permanent safeguard is very doable and so we will be working with our many partners around the globe on getting one included in the round.

STN: NCTO also established a grassroots network focused on generating support and input at the plant level of member companies. What is the level of involvement in this network and what have been some of its actions so far?

Gant: Grassroots networks are something new for the industry and I am pleased to say that NCTOs members have made them a big success. We were able to generate literally thousands of e-mails and letters on issues of concerns, most recently concerning our safeguard cases against China, and also on the need for trade agreements that benefit U.S. workers and U.S. companies, rather than Asian suppliers.

This is a new weapon in the industrys quiver for getting its issues noticed by the administration and by our supporters in Congress.

STN: Structurally, four industry councils were created within NCTO membership. How is this arrangement working so far?

Gant: Until the forming of NCTO no single trade association represented all segments of the industry. In establishing NCTO, this was our primary goal. Certainly there are differences, as one might expect when dealing with all aspects of the industry from fiber to fabric, but the industry has finally come together recognizing that we can generate more political clout and influence together than apart.

This world is moving so fast, it is quite difficult to keep up with all aspects of the industry and the varied interests of each segment. This is a challenge both at an organizational level as well as a communication level, but also a necessity for success.

STN: Besides the 800-pound gorilla issue, China, what other agenda items is NCTO working on?

Gant: NCTO is focused on numerous efforts other than China that benefit U.S. textile manufacturers. We have recently been engaged in concerted efforts to provide adequate textile customs enforcement and to ensure the commitment made to hire and train 72 new textile enforcement customs agents that was part of the Trade Promotion Authority Act of 2002 is fulfilled.

A very important priority for our membership is to prevent textile trade preference legislation for Haiti and other least-developed countries (LDCs) from moving forward in Congress. We have been working with the administration and our supporters in Congress to ensure that aid efforts for Haiti and the LDCs focus on economic and development aid, which will address these countries greatest needs.

As the needs of our Department of Defense have increased due to the wars in Iraq and Afghanistan, we have been working with Congress to ensure that the Department of Defense is adhering to the requirements of the Berry Amendment and to provide more transparency in the procurement system to ensure easier monitoring of compliance with these requirements.

The Berry Amendment requires the DoD to buy certain products  judged essential to our military readiness  with 100 percent U.S. content and labor. These products include clothing and other textile items, specialty steel, and food.

We have also been closely involved with ongoing trade negotiations with the Andean countries, the Middle East and South Africa to ensure that a yarn-forward rule of origin is maintained in future trade agreements and to prevent unnecessary loopholes that harm U.S. textile manufacturers from being included.

As you know, Vietnam is also in the process of negotiating its WTO-accession agreement and we have been closely monitoring these negotiations to ensure that a safeguard mechanism is included as part of this agreement. We also mentioned earlier the importance of the Doha Round and our efforts to ensure that textile tariffs are maintained as part of this negotiation.

While China is the 800-pound gorilla, there are a lot of other 300-, 400- and 500- pound gorillas out there that also need attention.

STN: Allen, you and Larry A. Liebenow of Quaker Fabric Corp. were recently nominated by President Bush to serve on the 25-member Advisory Committee for Trade Policy and Negotiations  the first textile appointments to this committee in more than 10 years. Please comment on this nomination and your goals as a member of this panel.

Gant: Having a domestic textile manufacturer appointed to the ACTPN is, I believe, great news for the textile industry. I have always believed that you must work within an organization to affect change and I hope the ACTPN will provide an opportunity to do just this.

STN: You are about to hand the gavel to Jim Chesnutt, no stranger to leadership positions in this industry and definitely a strong voice for domestic textiles. Having worked closely with him over the last year, please comment on the skills sets he brings to the table as chairman.

Gant: Jim is a close friend and I cannot think of anyone who is better qualified and prepared to take this organization to the next level.

He is a visionary and someone who appreciates and understands the strength and importance in speaking with a unified voice.

He is held in the highest regard within our industry and someone who is absolutely trusted and whose word is his bond.

These character traits will serve him extremely well as chairman of NCTO and I look forward to witnessing all the great things he will accomplish in the coming year.

China safeguards

May 9, 2005

Government signals delay

WASHINGTON, DC  The U.S. government announced May 6 that it would extend its deadline to render decisions on the threat-based cases filed by the U.S. textile industry in 2004.

In a release, the government announced that its new deadline by which it would make decisions on the threat-based safeguards would be 60 days from the publication of the May 6 release in the Federal Register.

This announcement could delay a decision on certain threat-based petitions until July, giving China significantly more growth to the baseline to which any safeguard would be applied, according to the American Manufacturing Trade Action Coalition (AMTAC).

Safeguards do not cut trade, but only can limit the growth of existing trade to a minimum of 7.5 percent (6 percent for wool products).

As for other cases, decisions on the threat-based manmade fiber trouser, cotton shirt, manmade fiber shirt, cotton and manmade fiber non-knit shirt and cotton and manmade fiber underwear cases could be delayed as long as an additional 33 days. The deadline on the threat-based combed cotton yarn case could be delayed as long as 13 days.

There is absolutely no reason for the U.S. government to stall the decision-making process any longer on cases where the public comment period has already closed, said Auggie Tantillo, executive director of the American Manufacturing Trade Action Coalition (AMTAC), the Washington-based trade organization.

Trade show

May 9, 2005

TUFT TO BEAT: FloorTek Expo has sector covered

DALTON, GA  Everybody whos somebody in the flooring sector  a $20 billion industry employing hundreds of thousands of people from around the world  will converge on the Northwest Georgia Trade and Convention center here May 17-19 for the biennial FloorTek Expo.

FloorTek is the carpet industrys only exposition showcasing the latest technologies and services from around the world and the seminars and related events provide a valuable educational opportunity, featuring knowledgeable, international industry experts.

More than 80 percent of all carpet in the U.S. is manufactured within 40 miles of Dalton, known as the carpet capital of the world.

For the third time, the trade show will include all flooring surfaces, from carpet, hardwood, vinyl and laminate to stone and non-traditional surfaces.

This format offers an ideal opportunity for flooring industry professionals at every level from around the world to share information and explore every avenue for widening the flooring marketplace, according to the American Floorcovering Alliance (AFA), the host organization.

This years event promises to display the most innovative and technological changes sweeping through the industry, according to Wanda Ellis, executive director of AFA.

FloorTek will include representation of all aspects of the carpet industry.

A number of seminars are scheduled for the opening day, May 17.

An opening VIP panel discussion will be moderated by Dr. Marilyn Helms, D.B.A., CFPIM, CIRM, Sesquicentennial Endowed Chair and professor of Management at Dalton State College.

Epic also manufactures EpiMark color markers, which are cold water soluble marks used to identify yarns and fabrics in a wide variety of applications and industries. Epic offers a rebuilding service for spindles, pots, pot bearing housings and ring assemblies used on spinning and twisting machinery.

PAF Sales LLC  The Greensboro, NC-based company, which represents BTSR International in the Western Hemisphere, will provide demonstrations of programmable electronic yarn control systems. PAF also is associated with Otto Zollinger, Inc. (tension control systems) and Sensatus Technologies (quality).

Trade association

May 9, 2005

NTA members meet with DoD

BOSTON  U.S. textile industry executives met April 26 in Charlotte, NC, with senior officials from the U.S. Department of Defense (DoD) for a briefing on government procurement of textile, clothing and individual equipment items.

The program was sponsored by the National Textile Association (NTA). DoD bought more than $2.6 billion of textiles, apparel and individual equipment in 2004 and is expected to buy about the same amount this year.

Under the regulations of the Berry Amendment governing military procurement, all items are required to be U.S.-made.

About 50 NTA members attended the briefing session, which was sponsored by the associations Government Textile Committee.

The program included presentations by senior officials from the U.S. Army, Navy, Air Force and the Defense Logistics Agencys central procurement facility, Defense Supply Center Philadelphia.

The NTA committee serves as the textile industrys spokesman with DoD clothing and textile issues, and works cooperatively with DoD agencies on textile items, supply issues and the overall procurement process.

The National Textile Association is the largest trade association representing the U.S. textile industry, and consists of more than 100 companies that spin yarns; manufacture fabrics; dye, finish and print fabrics; and cut and sew top-of-the-bed textile products.

Fabric producer

May 9, 2005

Guilford names auto supply industry veteran president/CEO

GREENSBORO, NC  Guilford Mills, a global designer and manufacturer of value-added fabrics and engineered products, announced that Shannon M. White will join the company as president and chief executive officer, effective May 9.

He replaces John Emrich, who resigned as president and CEO on April 15.

White, 40, comes to Guilford after leading a successful turnaround at United Plastics Group, where he had been CEO since 2001. When White joined United Plastics, the company was struggling with the recession and negative cash flow. Under White, the companys operational and financial performance steadily improved and its global operations expanded into the critical China market.

Previously, Shannon was the regional director of Manufacturing for Rexam PLC, a $5.2 billion international manufacturer of packaging products.

White, a Utah native, graduated magna cum laude with a BS in economics from the University of Utah. He earned an MBA from the University of Southern California and began his career in 1992 as a financial analyst at New Jersey-based Allied Signal, Inc.

Mill notes

May 9, 2005

NC to lose 1,180 more textile/apparel jobs

Sara Lee to cut 350 in branded apparel unit

CHICAGO  Sara Lee Corp. said May 2 that is will cut 350 jobs in its branded-apparel division in Winston-Salem, NC, as part of its plans to spin off the division into an independent, publicly traded company.

The company is offering a voluntary separation program to managerial, professional and support staff interested in leaving the company, with layoffs representing the balance of the targeted job elimination.

About 5,250 people are expected to be employed in the Winston-Salem area after the cuts are completed, which the company said it expects to occur by mid-July.

The decision does not affect employees in the divisions manufacturing, distribution and retail stores.

In the highly competitive world in which we operate, we must take steps to streamline our existing organization to deliver a more economical cost structure and at the same time add those functions required to become a publicly-held company, Lee Chaden, CEO of branded apparel, said in a release.

Sara Lee also plans to sell its European apparel business.

Culp, Inc. to eliminate 225 in upholstery

HIGH POINT, NC  Culp, Inc., warning of a sharper-than-expected financial loss in the fourth quarter, said May 2 that it will eliminate 225 jobs at its Burlington, NC, upholstery operations.

The cuts represent about 17 percent of those in Culps domestic upholstery fabrics business.

The company said it will relocate velvet production equipment from the manufacturing facility in Burlington to its other velvet plant in Anderson, SC. The Burlington facility will then be utilized as an inspection and distribution facility for fabrics imported from offshore sources and for finished goods warehousing of domestically produced upholstery fabrics.

Culp also will combine its sales, design and customer service activities for Culp Decorative Fabrics and Culp Velvets/Prints, the two divisions within the upholstery fabrics segment. As a result, the company will list for sale two buildings in Burlington, consisting of about 140,000 square feet.

Based on preliminary quarterly results and estimates, Culp said it expects to report a loss in the range of 13 cents to 17 cents per diluted share for the fourth quarter, excluding restructuring and related charges.

VF Corp. to close Wilson plant, costing 445 jobs

GREENSBORO, NC  Apparel maker VF Corp., said May 3 that it will close a jean-making plant in Wilson, NC, by June 2006, putting 445 people out of work.

Work from the VF Jeanswear LP plant will be moved offshore, the company said.

The shutdown is the latest step in a major overhaul that began in 2001, which has resulted in seven plant closings.

M.J. Soffe to slash 160 sewing positions

The company, which closed a Bladenboro, NC, sewing plant last month and plants in Maxton, NC, and Wallace, NC, in 2002, will move the work to El Salvador.

When the cuts become final, about 930 Soffe jobs will remain in the state, at its Fayetteville and Rowland plants.

While moving apparel jobs offshore, Soffe said it plans to add textile jobs. The company, which was bought by Delta Apparel, Inc. of Duluth, GA, in 2003, will increase fabric production at its Fayetteville plant from about 125,000 pounds of cloth per week to more than 200,000 pounds.

Soffe said it will keep 83 employees to produce products for the military.

IFFE speaker

May 9, 2005

Buhlers Bieri extols virtues of quality, Supima cotton

NEW YORK  Consumers say they are fed up with poor quality and poor design and would be glad to pay a better price if they would have the guarantee to have a better garment, a prominent textile manufacturer said during the recent International Fashion Fabric Exhibition (IFFE) here.

Buhler Quality Yarns Corporation CEO Werner Bieri told some 45 designers and representatives of top apparel manufacturers at a joint presentation by Buhler and Supima that quality for consumers goes all the way back to the fiber.

A way for the fabric and garment buyer as well as for the consumer to be sure that they are buying a better product is to check for fiber content, Bieri told the group, which included representatives of Brooks Brothers, Banana Republic, Michael Stars, GAP and others.

Extolling the virtues of Supima cotton as a key component of luxury apparel, Bieri  whose company is a major spinner of high-quality yarns from Supima cotton, and is the leading supplier of fine-to-medium count yarns in the NAFTA, Central American, South American, Caribbean and South Asia markets  said his company has given absolute priority to fiber quality.

While price is a very important component in the procurement process, its just one component  fiber characteristics and properties are equally important, Bieri said.

Bieri and Supima Marketing Director Buxton Midyette gave the audience a primer on characteristics of Supima cotton, with its length adding strength, fineness and softness to yarns and the fabrics made from them. The micronaire  or number of fibers per cross section  of premium cottons such as Supima puts them in the optimum range for dyeing, and that creates fabrics with brilliant color and luster.

American Pima fiber is among the strongest fiber there is on the cotton market, basically twice as strong as upland (cotton) once in garment form, Bieri said. Fiber length and strength advantages of Pima cotton in spinning, where fibers are twisted together to create yarn, are something the consumer can feel, he said.

The longer staple (fiber) allows for less twist and therefore makes for a softer hand,  Bieri said. The longer fiber is also better spun into the core of the yarn, making for a lesser pilling tendency in the finished garment.

Dyeing and finishing enhancement including wrinkle-free characteristics work especially well with Pima cotton, Bieri said.

American Pima has a much higher color intake then any other fiber and garments made out of this fiber have a more luxurious and silky appearance than garments made of any other cotton fibers, he said. We have in many instances been able to replace the very costly mercerization process and, just by using American Pima cotton, given the garment the same bright look, but having at the same time a much softer hand and a better overall fabric.

Bieri cited his own experience as a testimony to Pima quality: I am often confronted with two garments  one made of Pima cotton yarn, and the other made of upland cotton yarn. The usual comment: Please tell me if you can feel and see a difference, except on the price point. And with todays possibilities in finishing, it is in certain cases really difficult to tell which is which.

Then he added, I ask if I can take both with me and have them worn and washed. Usually even after just one cycle  but with 100 percent guarantee after five cycles  the questions dont need to be asked anymore. Shrinkage, pilling, ragged look, etc. give a clear answer.

Midyette echoed Bieris assessment of consumers seeking quality and luxury in apparel as in other aspects of their lives.

Affluent consumers seek to incorporate luxury into their everyday lives, Midyette said. They are willing to pay a premium for high-quality goods.

Supima is the promotional group for American Pima cotton growers whose product carries the specific Supima® brand.

Cotton association

May 9, 2005

Leaders sought for NCC class

MEMPHIS  The National Cotton Council is accepting applications for the 2005-06 Cotton Leadership Class through July 1.

Those interested in applying can visit the Cotton Leadership Programs web site at http://leadership.cotton.org to review the program curriculum, eligibility requirements and download the application. The site also includes a contact form that allows users to submit questions, request information and schedule a personal visit with local program alumni.

The 2005-06 class, which will be comprised of four producers and one participant from each of the other six industry segments, will be announced in August by the NCCs Cotton Leadership Development Committee.

The Cotton Leadership Program seeks to identify potential industry leaders and provide them developmental training. During five sessions of activity across the Cotton Belt, class participants visit with industry leaders and observe production, processing and research.

They also meet with lawmakers and government agency representatives during a visit to Washington, DC, and attend the NCCs annual meeting and its mid-year board of directors meeting.

The program, initiated in 83, is supported by a grant to The Cotton Foundation from DuPont Crop Protection and is managed by NCCs Member Services department.

Equipment supplier

May 9, 2005

Trützschler's U.S. branch to serve nonwovens side

CHARLOTTE, NC Textile machinery producer Trützschler GmbH & Co. of Germany said it will concentrate its nonwovens activities at its U.S. subsidiary, American Truetzschler, based here.

The operation will attend to the complete nonwoven product range of the companys line, the company said.

After extensive investments in new production lines, American Truetzschler will produce special machines of Trützschlers nonwoven product range in the U.S. and supply them worldwide.

Irrespective of Trützschlers core business, consisting of cleaning machines, cards and draw frames, individual solutions can be worked out with customers and produced on short notice in Charlotte, the manufacturer said.

The new production lines at American Truetzschler are especially equipped for the construction of machine parts with large dimensions. This applies mainly to the tuft feeder SCANFEED, used mostly for roller cards and web-forming machines worldwide.

The SCANFEED for roller cards is a double trunk feeder with pneumatic compression. The machine has been further enhanced and is now available in widths up to 5 m. It is the only tuft feeder that controls the evenness of the tuft web in length and width at high precision, Trützschler said.

American Truetzschler offers an exclusive service in cooperation with Dilo and Fleissner. The technical education facilities of both companies are equipped with Trützschler machines for extensive customer trials. Trials on Trützschler machines also can be carried out at N.C. State University in Raleigh, NC.

Pickin' Cotton

May 9, 2005

With every knockout blow, market still rights itself

By Odyll Santos

China continued to be a major topic in the New York cotton market in the last week of April, as expectations of huge cotton sales to China buoyed prices to multi-month highs. At that time, the July futures contract was challenging the price level of 58.00 cents per pound, while the new-crop December contract was aiming for 59.00 cents.

Prices received a boost as a major international merchant took delivery of all cotton on the May futures contract, an amount of about 200,000 480-pound bales, and decertificated an additional 100,000 bales. With a substantial amount of cotton going to one merchant alone, talk within the market revolved around the possibility that export sales of 300,000 to 500,000 bales had been made to China. Any sales that have taken place are likely to be reported in the coming weeks in May.

China has been a major participant in cotton trade. According to the USDA export sales report released on April 28, net U.S. upland cotton sales totaled 208,300 running bales (more than 216,000 480-pound bales) for the week ended April 21. While Turkey was the primary buyer, with 101,600 running bales, China also was a buyer, at 39,500 running bales. Other countries in Asia were among the list of buyers during the week. Shipments for the week ended April 21 were 356,300 running bales (more than 371,000 480-pound bales). Of the total, 90,100 running bales were shipped to China, with 51,400 to Turkey and 37,100 to Mexico.

Chinese cotton consumption in 2004-05 is expected at 37.5 million 480-pound bales, up from 32 million in the previous season, according to USDA April supply/demand data. With domestic production seen at only 29 million 480-pound bales, farmers in China cannot keep up with textile mill demand. Mills have to rely on imported cotton to make up for the shortage. The USDAs April estimate for Chinese imports in 2004-05 is 8.0 million 480-pound bales.

The strength in Chinese consumption and imports long had been expected to provide significant support to New York cotton futures despite conditions that should be pushing prices lower. Cotton marketing specialist O.A. Cleveland noted that carryover in the world and in the U.S. both are well above levels seen in the previous year. World ending stocks are 47.8 million 480-pound bales, nearly 12 million above last years figure, while U.S. carryover is a little more than 7.0 million 480-pound bales, double the level a year earlier.

It would be logical (to) suggest and argue that the cotton market should be on its heels, taking deep sniffs of ammonia just to remain standing, Cleveland said in market comments for the week ended April 29. Yet, such is not the case. With every knockout blow, the market rights itself and amazingly charges ahead  the classic bull in a china shop.

He added that the markets ability to recover each time prices fall has been evident since August 2004. New York futures prices fell below 42.00 cents per pound in the fall of 2004, but prices managed to recover in the following months, even making notable gains several times.

Cleveland expects the market to bounce back from any sell-offs. But as the market tries to determine just how much China will buy and consume this year and even next year, he warns producers and other market participants not to become too bullish on China.

Guest Editorial

May 9, 2005

DR-CAFTA a win-win

By Katherine Mejia Alexander

Editor's note: The author owns and operates Mejia Interior Design of Charlotte, NC. She can be reached by e-mail at mejiakat@aol.com.

I think its safe to say that, like most Americans, I dont often hear about an issue being debated by Congress and think, wow, thats me! Thats all about me! So, on the rare occasion that this does happen, I feel compelled to learn more about the issue and share what Ive learned with others.

Today, the issue thats sparked me is the Dominican Republic-Central American Free Trade Agreement, or whats commonly called DR-CAFTA. DR-CAFTA is the free trade agreement our government has negotiated with the nations of Central American  Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua  and the Dominican Republic. And, from everything Ive learned about DR-CAFTA, its one of those rare win-win opportunities.

Some 20 years ago, the U.S. opened its markets to the exports of the Central American and Caribbean nations. This was done to assist these nations in both their economic and political development. As the daughter of a Salvadoran, I can attest to the fact that it worked.

Though the Central American nations are still poor by American standards, over the past 20 years things have gotten a great deal better for ordinary people in these countries. These improvements have not only come in peoples standard of living but also in the political climate. These were nations ripped by civil war in the 1980s; now they are growing democracies.

Once upon a time, if a Central American wanted to advance, he or she had to leave their home.

Such was the case with my Salvadoran father, who after working on the Panama Canal decided to come to the Land of Opportunity  California. Here, in America, his entrepreneurial qualities spelled success. He purchased the Academy of Fashion Design and opened Alexanders Fine Tailoring in San Francisco.

Today, I, like my father, am a quintessential American  an entrepreneur with an interior design business and clothing design line called COCO MEJIA. There are 2 million Hispanic-owned business in the U.S. today, generating $300 billion dollars in revenue annually in this country.

DR-CAFTA is the next step in this process and its a win-win proposition because, while it continues the development of these nations, it also opens markets that had previously been severely restricted for American businesses. As an American-Salvadoran businesswoman, this is very important to me.

Im happy that weve helped Central America develop by accepting their exports without expecting absolute reciprocation, but now that the Central American economies are ready, I want in, too.

This agreement will give me personally two opportunities. First, it will allow me to fulfill my dream of doing business in El Salvador. And second, as a small business owner, it opens the possibility of competing in this global market.

Finally, DR-CAFTA works for me as a North Carolinian because one of the industries in particular that DR-CAFTA would most benefit is a local one  textiles. Over the past decades, we North Carolinians have watched textile jobs leave the state. I admit, trade may have played a role in some of these job losses.

But with DR-CAFTA, its different. The Central American countries could be strong partners to our textile industries in our competition with Asia. If the restrictions on textile exports to Central American are lifted, American textile companies and Central American garment assembly companies could work more closely together to create products that use American inputs but are priced to compete with products made 100 percent in Asia of 100 percent Asian inputs. Thats just one more reason I believe DR-CAFTA to be a win-win agreement.

So, if you open the newspaper or turn on the radio and hear about DR-CAFTA, or some other issue being debated in Congress, give it a moments thought. Like me, you might find that its really about you.